Weathering the Storm

Commissioned by Martin O’Malley, Maryland State Governor

The year 2012 has seen its share of storms, namely the October Hurricane Sandy “Frankenstorm” and the June Derecho. These events serve as a reminder of the increasing importance of reliable electricity supply to the modern economy. The high cost of extended outages caused by the June 29 Derecho prompted Maryland’s Governor to issue an Executive Order, calling for an investigation into ways to lessen the impact of future storms to the state’s economy.

A task force directed by the Governor’s Energy Advisor Abigail Hopper convened a series of roundtables to solicit the input of experts on topics including high-resiliency options in electric distribution infrastructure design, human infrastructure, emergency planning, and regulatory approaches to the recovery of investments in hardening electric distribution systems. Bates White Partner Nicolas Puga assisted the Task Force in drafting recommendations for potential regulatory reforms and other policy changes aimed at improving the resiliency of Maryland\'s electricity distribution systems and reducing the duration of weather-related outages.

Mr. Puga’s recommendations, adopted by the Resiliency Task Force, included: (1) requiring utilities to file a brief an easy to understand report within 10 days of a major storm to enable the public to compare outage and restoration times across service territories, (2) the consideration of costs experienced by consumers during an outage in the cost-benefit analysis of investments in hardening utility distribution systems and in accelerating the restoration of electric service, and (3) the incorporation of performance-based regulatory incentives and penalties for utilities investing in the improvement of reliability of service to their customers.